Question

Deelux manufactures paint. The company charges the following standard unit costs to production on the basis of static budget volume of 30,000 cans of paint per month:
Direct materials........................................................................................... $2.50
Direct labour............................................................................................... 2.00
Manufacturing overhead............................................................................. 1.50
Standard unit cost.......................................................................................$6.00
Deelux allocates overhead based on standard machine hours and uses the following monthly flexible budget for overhead:

Deelux actually produced 33,000 cans of paint using 3,100 machine hours. Actual variable overhead was $16,200, and fixed overhead was $32,500. Compute the total overhead variance, the overhead flexible budget variance, and the production volume variance.